Here’s Why Baron Funds Trimmed its Splunk Inc. (SPLK) Position

Baron Funds, an asset management firm, published its “Baron Opportunity Fund” first quarter 2021 investor letter – a copy of which can be downloaded here. A return of 0.88% was delivered by the fund’s institutional shares for the Q1 of 2021, below both its S&P 500 and Russell 3000 Growth Index that delivered a 6.17% and 1.19% returns respectively for the same period. You can view the fund’s top 5 holdings to have a peek at their top bets for 2021.

Baron Opportunity Fund, in their Q1 2021 investor letter, mentioned Splunk Inc. (NASDAQ: SPLK), and shared their insights on the company. Splunk Inc. is a San Francisco, California-based software company that currently has a $20.7 billion market capitalization. Since the beginning of the year, SPLK delivered a -25.59% return, while its 12-month gains are down by -6.30%. As of April 30, 2021, the stock closed at $126.42 per share.

Here is what Baron Opportunity Fund has to say about Splunk Inc. in their Q1 2021 investor letter:

“We concluded it was prudent to trim Splunk, Inc. to a smaller position as it experienced a couple of challenging quarters last year and withdrew its long-term guidance, raising concerns that we are carefully researching.”

10 best cheap stocks to invest in February 2021

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Our calculations show that Splunk Inc. (NASDAQ: SPLK) ranks 25th in our list of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the fourth quarter of 2020, Splunk Inc. was in 47 hedge fund portfolios, compared to 44 funds in the third quarter. SPLK delivered a -26.34% return in the past 3 months.

The top 10 stocks among hedge funds returned 231.2% between 2015 and 2020, and outperformed the S&P 500 Index ETFs by more than 126 percentage points. We know it sounds unbelievable. You have been dismissing our articles about top hedge fund stocks mostly because you were fed biased information by other media outlets about hedge funds’ poor performance. You could have doubled the size of your nest egg by investing in the top hedge fund stocks instead of dumb S&P 500 ETFs. Here you can watch our video about the top 5 hedge fund stocks right now. All of these stocks had positive returns in 2020.

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Disclosure: None. This article is originally published at Insider Monkey.